Britain’s culture secretary on Friday compared the United States crackdown
on online gambling to the failed alcohol ban of the Prohibition as she
prepared to host an international summit on Internet gambling next week.
Tessa Jowell warned that the U.S. ban on Internet gambling would make
unregulated offshore sites the “modern equivalent of speakeasies,” illegal
bars that opened in 1920s America when alcohol was banned. U.S. Congress
caught the gambling industry by surprise earlier this month when it added to
an unrelated bill a provision that would make it illegal for banks and
credit-card companies to settle payments for online gambling sites. The
decision closed off the most lucrative region in a market worth $15.5
billion this year in “spend” value – the amount gambling companies win from
their clients, or the amount gamblers lose. Several London-based Internet
gambling companies and a handful in Europe and Australia subsequently sold
off or shut down their U.S. operations, losing around 80 per cent of their
combined business in the process. U.S. officials have declined to
participate in Tuesday’s gambling summit in London, where lawmakers from 30
countries will discuss ways to regulate the industry, including the
protection of minors and keeping the industry free of crime.